Pakistan targets January for inaugural panda bond tranche, says finance ministry

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 Pakistan is targeting January to issue its first panda bond tranche, part of a planned programme of up to $1 billion, the Ministry of Finance said on Friday, as Islamabad seeks to diversify funding sources and tap China’s onshore debt market.

The inaugural issuance is expected to raise the equivalent of about $250 million, with further tranches to follow under a phased programme once regulatory approvals are completed, the ministry said after Finance Minister Muhammad Aurangzeb chaired a review meeting on the plan.

Approvals from multilateral partners have already been secured, and final clearances from Chinese regulators are expected by early January, the statement said.

The panda bond programme, denominated in yuan and sold on China’s domestic market, is part of Pakistan’s broader debt management strategy as it works to stabilize its economy under a $7 billion International Monetary Fund programme.

Pakistan Advances Toward USD 1 Billion Panda Bond Program with Inaugural Issuance Targeted for January

Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, chaired a meeting at the Finance Division today to review progress on Pakistan’s inaugural Panda Bond… pic.twitter.com/5BtCRTX2R0

— Ministry of Finance, Government of Pakistan (@Financegovpk) December 19, 2025

Pricing for the inaugural bond will be determined closer to the launch once all regulatory requirements are completed, the ministry said.

The finance ministry said engagement with Chinese institutional investors had been constructive, reflecting improving confidence in Pakistan’s macroeconomic outlook following recent policy reforms.

Preparatory work has already begun for subsequent tranches within the planned $1bn panda bond programme.

Moody’s raised its long-term foreign-currency issuer rating to Caa1 with a stable outlook in August 2025, citing an improving external position supported by reforms and IMF support. S&P Global Ratings upgraded Pakistan to B- with a stable outlook in July 2025.

Pakistan has relied heavily on bilateral and multilateral financing, including short-term funding from Middle Eastern banks, but is now looking to broaden its investor base through markets such as China’s onshore bond market.